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Questions over Jetstar bring more pain for Geelong

SCOTT BEVAN: Well, the pain and uncertainty caused by a decline in manufacturing is something the Victorian city of Geelong knows all too well. Geelong has had one of its toughest years yet, and it's set to get a whole lot harder for the industrial hub.

Several big employers have announced their imminent closure or the scaling down of operations, including Ford, which will close its car factory, and Shell, which plans to sell off its refinery.

On top of it all, airline Jetstar is now considering its future at nearby Avalon airport, potentially putting another 250 jobs at risk.

A local delegation travelled to Canberra this week to discuss the plight of Geelong.

Cameron Best reports from Geelong.

CAMERON BEST: Victoria's second airport Avalon is a major employer for the Geelong region. That's why this week's announcement by the airport's only commercial tenant, Jetstar that its Avalon services are underperforming and will be re-evaluated is creating huge anxiety.

In fact, many say any loss of services to Avalon would be felt as heavily as Ford's decision to stop manufacturing in 2016.

Geelong's new mayor, Darryn Lyons, wants to see more flights out of Avalon rather than less.

DARRYN LYONS: I want to open Geelong up to business and Jetstar pulling out is a ridiculous message to send. So my message to them is to stay open, get bigger, get bolder, and get more brash.

CAMERON BEST: Jetstar's not talking of pulling out of Avalon just yet. In fact the vision is to see the airport develop into a transport and logistics hub and international terminal. But that vision becomes cloudier without a domestic carrier.

Recognising the danger, Victorian Premier Denis Napthine put a multi-million dollar package on the table to try and keep Jetstar flying in and out of Avalon.

DENIS NAPTHINE: And we have acted immediately, we have acted strongly, we have acted decisively. We have put on the table a substantial offer to assist in the continuation of those services on a secure, long-term basis, and we have asked the operators of Avalon airport to match our offer.

CAMERON BEST: It caps off a tough year for Victoria's second city. It started with Shell announcing its plans to sell its Geelong refinery. Then after nearly 90 years in the city, Ford announced it will close its Geelong engine plant in 2016. And, last month, Qantas pulled the plug on its heavy maintenance base at Avalon.

It's widely expected that the next hammer to fall could be Alcoa's aluminium smelter at Point Henry, as the company looks to reduce its global smelting capacity.

The British High Commissioner to Australia, Paul Madden, has been in discussions with officials from Geelong, and believes the city could learn some lessons from the experiences of some traditional manufacturing cities in the UK.

PAUL MADDEN: Well, I think there'd be a whole swathe of cities - particularly in what people often refer to as the industrial north of the UK which tended to be where much of the manufacturing sector was - and the solutions that they found tend to be very much based on service industry, particularly using the strengths of education institutions where they can in some cities in the UK.

Some of the universities have become the major employers in town, and certainly they are a source of innovation which then spins out into new high tech companies.

CAMERON BEST: Health, education and research have become major sectors for employment in the Geelong region. But local MP Sarah Henderson says, like many cities in the UK, blue-collar jobs remain a cornerstone.

SARAH HENDERSON: Manufacturing is still responsible for about 43 per cent of the local economy, so manufacturing plays a very important role in Geelong's economy and I have no doubt that will continue.

Yes, there are some challenges, but we need to be smart about manufacturing, and if you look at what Deakin is doing with some of its research work in defence and carbon fibre, we have a very bright future. But there's no doubt we need to be smart about what we do and how we invest.

RICHARD MARLES: Geelong is experiencing the transition that our economy more generally is experiencing in the context of industry and manufacturing and we need to have governments that are committed to manufacturing being a part of Australia's future economy going forward.

CAMERON BEST: Geelong's leaders headed to Canberra this week to lobby for more support for the city's economic transition. They were buoyed by a promise by the Victorian Liberal Government to transfer the state WorkCover Authority to Geelong if it wins next year's state election.

It would bring with it much needed jobs, and would follow the Transport Accident Commission's relocation from Melbourne in 2009, and the establishment of the National Disability Insurance Scheme headquarters in Geelong.